Current Report Filing (8-k)
March 09 2017 - 6:16AM
Edgar (US Regulatory)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT
TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
March 8, 2017
Date
of Report (Date of Earliest Event Reported)
SEARS
HOLDINGS CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
Delaware
(State or Other
Jurisdiction of Incorporation)
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000-51217, 001-36693
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20-1920798
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(Commission File Number)
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(I.R.S. Employer Identification No.)
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3333 Beverly Road
Hoffman Estates, Illinois 60179
(Address Of Principal Executive Offices, including Zip Code)
Registrants Telephone Number, Including Area Code: (847) 286-2500
Not Applicable
(Former
Name or Former Address, If Changed Since Last Report)
Check the appropriate box below
if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item 1.01
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Entry into a Material Definitive Agreement
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License Agreement
On March 8, 2017, Sears Holdings Corporation, a Delaware corporation (the Company), and Stanley Black & Decker, Inc., a Connecticut
corporation (Stanley), entered into a license agreement (the License Agreement). Pursuant to the License Agreement, Stanley will license to the Company the Craftsman brand name and related intellectual property rights (the
Licensed IP), and Sears Holdings will have the right to use the Licensed IP and to continue to sell Craftsman branded products in certain distribution channels, including stores owned and operated by the Company under the Sears and Kmart
brands and related ecommerce sites. The license will be royalty-free for a period of 15 years and will have a royalty rate of 3% of net sales thereafter. The License Agreement may be terminated by Stanley if the Company materially breaches any of
the material terms of the License Agreement, subject to a notice and cure period, or if the Company ceases to sell or sublicense products branded with the Licensed IP, such that no such products are sold for any consecutive six-month period.
The foregoing description of the License Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the
License Agreement, which is included as Exhibit 10.1 hereto and is incorporated herein by reference.
PBGC Matters
In connection with the closing of the sale of its Craftsman business to Stanley (the Transaction), the Company reached an agreement (the
Consent, Waiver and Amendment) with the Pension Benefit Guaranty Corporation (PBGC) pursuant to which PBGC has consented to the sale of the Craftsman-related assets that had been ring-fenced under the March 2016
pension plan protection and forbearance agreement between PBGC and the Company (the PPPFA) and certain related transactions. As a condition to obtaining this consent, the Company agreed to grant to PBGC a lien on, and subsequently
contribute to the Companys pension plans, the value of the $250 million cash payment payable to the Company on the third anniversary of the closing of the Transaction, with the value of such payment being fully credited against certain of the
Companys minimum pension funding obligations in 2017, 2018 and 2019. The Company also granted a lien to PBGC on the 15-year income stream relating to new Stanley sales of Craftsman products, and agreed to contribute the payments from Stanley
under such income stream to the Companys pension plans, with such payments to be credited against the Companys minimum pension funding obligations starting no later than five years from today. The Company also agreed to grant PBGC a lien
on $100 million of real estate assets to secure the Companys minimum pension funding obligations through the end of 2019, and agreed to certain other amendments to the PPPFA.
The foregoing description of the Consent, Waiver and Amendment does not purport to be complete and is qualified in its entirety by reference to the full text
of the Consent, Waiver and Amendment, which is included as Exhibit 10.2 hereto and is incorporated herein by reference.
On March 9, 2017, the Company issued a press release announcing that it had completed
the sale of its Craftsman business to Stanley. The press release is attached hereto as Exhibit 99.1 and is incorporated by reference herein.
Forward-Looking Statements
This Current
Report on Form 8-K contains forward-looking statements intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. Forward-looking statements are subject to risks and uncertainties that
may cause the Registrants actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements. Such statements are based upon the
current beliefs and expectations of the Registrants management and are subject to significant risks and uncertainties. Factors that could cause actual results to differ from those set forth in the forward-looking statements include, but are
not limited to, those discussed in this Form
8-K and those discussed in the Registrants most recent Annual Report on Form 10-K and other filings with the U.S. Securities and Exchange Commission. The Registrant intends the
forward-looking statements to speak only as of the time made and does not undertake to update or revise them as more information becomes available, except as required by law.
Item 9.01
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Financial Statements and Exhibits
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Exhibit 10.1
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Acquired IP License Agreement, dated as of March 8, 2017, by and between Sears Holdings Corporation and Stanley Black & Decker, Inc.
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Exhibit 10.2
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Consent, Waiver and Amendment, dated as of March 8, 2017, by and between Sears Holdings Corporation, certain of its subsidiaries and Pension Benefit Guaranty Corporation.
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Exhibit 99.1
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Press Release, dated March 9, 2017.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
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SEARS HOLDINGS CORPORATION
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Dated: March 9, 2017
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/s/ Robert A. Riecker
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By:
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Robert A. Riecker
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Controller and Head of Capital Market Activities
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EXHIBIT INDEX
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Exhibit 10.1
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Acquired IP License Agreement, dated as of March 8, 2017, by and between Sears Holdings Corporation and Stanley Black & Decker, Inc.
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Exhibit 10.2
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Consent, Waiver and Amendment, dated as of March 8, 2017, by and between Sears Holdings Corporation, certain of its subsidiaries and Pension Benefit Guaranty Corporation.
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Exhibit 99.1
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Press Release, dated March 9, 2017.
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